Fast fashion e-tailer Boohoo has been hot on Nasty Gal's heels since the Los Angeles-based company filed for Chapter 11 bankruptcy protection in early November. The Manchester-based fast-fashion retailer filed a petition to incorporate Nasty Gal, Inc. in the U.K. just three weeks after its initial bankruptcy proceedings, and on Wednesday, confirmed its proposed acquisition.
Boohoo has put in a $20 million offer to acquire a portion of Nasty Gal's intellectual property, according to a press release. This motion makes Boohoo F I Limited, the company's subsidiary, the "stalking horse" bidder for the Nasty Gal brand and its customer databases in a bankruptcy auction scheduled for Jan. 5, 2017.
"Should we be successful in acquiring Nasty Gal it would represent a fantastic opportunity to add such a well-established, global brand to the Boohoo family," Mahmud Kamani and Carol Kane, Boohoo's joint CEOs, stated in the release. "Following our recent acquisition of PrettyLittleThing.com we believe this would represent an ideal next step in inspiring an ever-growing range of young customers internationally."
The rapidly growing retailer, which saw a 130 percent profit surge in the first half of the year, has been on an acquisition kick, announcing earlier this month that it was set to buy online fashion rival PrettyLittleThing.com's parent company 21 Three Clothing for £3.3 million, or roughly $4.04 million. Per the release, Boohoo feels an acquisition of Nasty Gal will be a win-win for both parties as it can offer the latter access to its "product development, supply and distribution expertise," while "[accelerating] the Group's international growth, particularly in the US."
Boohoo's bid comes after a tumultuous period for Nasty Gal that partially began when #GirlBoss incarnate Sophia Amoruso stepped down as CEO of the company she founded in January 2015. This was followed by a high-profile June 2015 lawsuit that claimed the company fired four employees after they became pregnant, and this past February, the retailer was hit with widespread layoffs as part of a company-wide restructuring. Shortly following its bankruptcy filing, Nasty Gal was approved to tap into an expedited $20 million loan, with Business of Fashion reporting soon after that Boohoo was already waiting in the wings to enter a bid.